In a case where a corporation transfers its purchaser's status of land acquired in annual installments before full payment of the price is made, whether it constitutes land not deemed land for non-business use under Article 84-4 (4) 8 of the former Enforcement Decree of the Local Tax Act (affirmative)

In full view of Articles 73(1) and (5), 84-4(1)1(a), (e), (2), and (4)8 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 14878 of Dec. 30, 1995), the land acquired in annual installments, for which use and profit-making has not been permitted, is still a non-business land under Article 84-4(4)8 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 14878 of Dec. 30, 1995), even if the purchaser transferred the purchaser's status before the purchase pays the purchase price, it is still a non-business land under Article 84-4(4)8 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 14878 of Dec. 30, 1995), so long as the land acquired in annual installments falls under a non-business land under the same subparagraph

Article 112(2) of the Local Tax Act; Article 73(1) and (5), and Article 84-4(1) and (4)8 of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 14878, Dec. 30, 1995)

Seoul High Court Decision 2001Na14488 decided May 1, 2001

Head of Goyang-si (Attorney Kim Tae-tae, Counsel for the defendant-appellant)

Seoul High Court Decision 97Gu38789 delivered on February 10, 1998

The appeal is dismissed. The costs of appeal are assessed against the defendant.

1. We examine the first ground for appeal.

Article 73 (1) and (5) of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 14878 of Dec. 30, 195; hereinafter referred to as the "Enforcement Decree") provides that the acquiring time of real estate shall be deemed to have been acquired on the date of payment of the balance under the contract and the actual payment date of annual installments shall be deemed to have been acquired, but the actual payment date of annual installments shall be deemed to have been acquired in case of acquisition in annual installments. Article 84-4 (1) 1 (a) through (e) of the Enforcement Decree of the Local Tax Act provides that the corporation shall not directly use the land within a given period from the date of its acquisition without justifiable reasons; subparagraph 2 of the same paragraph of the same Article; subparagraph 4 of the same Article is land sold within five years from the date of its acquisition for non-business use without justifiable reasons; where a seller permits the purchase of the land under annual installments and the land for which two years have not elapsed prior to the date of its permission for non-business use shall not be deemed to have been permitted.

In the same purport, the decision of the court below that the land of this case constitutes a non-business land under Article 84-4 (4) 8 of the Enforcement Decree of the Act is just, and there is no error of law by misapprehending the legal principles as to non-business land as otherwise alleged in the ground of appeal

2. As long as the land of this case constitutes land not deemed land for non-business use as above, the remaining grounds of appeal as to whether there is a justifiable reason under paragraph (1) of the same Article are without merit.

3. Therefore, the appeal is dismissed, and all costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Cho Chang-hun (Presiding Justice)